Local sports sentiment and returns of locally headquartered stocks: A firm-level analysis

Shao-Chi Chang, Sheng Syan Chen, Robin K. Chou, Yueh Hsiang Lin

Research output: Contribution to journalArticlepeer-review

38 Citations (Scopus)

Abstract

We undertake a firm-level analysis of the relation between National Football League (NFL) game outcomes and the return patterns of Nasdaq firms headquartered geographically near the NFL teams. We find that a team's loss leads to lower next-day returns for locally headquartered stocks and that this impact increases for a surprising loss or a critical game loss. The negative effects of game losses are stronger for stocks that are more vulnerable to shifts in sports sentiment. Our results suggest that the game outcomes of local sports teams influence investor sentiment, which significantly affects the returns of localized trading stocks.

Original languageEnglish
Pages (from-to)309-318
Number of pages10
JournalJournal of Empirical Finance
Volume19
Issue number3
DOIs
Publication statusPublished - 2012 Jun 1

All Science Journal Classification (ASJC) codes

  • Finance
  • Economics and Econometrics

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